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Seminarios académicos y conferencias

Francisco Gallego, PUC-Economía

"Approximating the Equilibrium Effects of Informed School Choice"

12 Septiembre 2018 - 15:30 hrs.

Sala de postgrados, Facultad de Ciencias Económicas y Administrativas UC

Abstract: This paper studies the small and large scale effects of a policy designed to produce a more informed consumer demand in the context of the market for primary education. We develop and test a personalized information intervention that targets families of public Pre-K students entering the elementary school system in Chile. Using a randomized control trial, we find that the intervention shifts parents’ choices toward schools with higher average test scores, higher test score value added, higher prices, and schools that tend to be further distances from their home. Tracking students using administrative data, we find that student academic achievement was higher among treated families four years later, providing suggestive evidence that this policy intervention was successful. To quantitatively gauge how average treatment effects might vary in the context of a scaled up version of this policy, we embed the randomized control trial within a structural model of school choice and competition where price and quality are chosen endogenously and schools face capacity constraints. We use the estimated model of demand and supply to simulate policy effects under different assumptions about equilibrium constraints. In counterfactual simulations, we find that capacity constraints play an important role mitigating the policy effect on impact but that the supply-side responds by increasing quality which contributes to an overall positive average treatment effect.